What the Growth of Slack and Microsoft Teams Means for Enterprises

Slack and Microsoft Teams have seen tremendous growth in small, medium, and large businesses. But, it’s the enterprise that will be most impacted by the ever-increasing adoption of team messaging apps and remote work.

In many cases, multiple team messaging apps are used within the same company. 

In fact, one study found that organizations use an average of 3.3 apps. 

This is because businesses need to communicate with clients and users who use apps for daily communication.

So, overall, what does the growth of Slack and Microsoft Teams mean for enterprises?

In this post, we’re going to hit on:

• Growth stats for Slack and Microsoft Teams
• Household names using Slack or Microsoft Teams
• Slack and Teams in use together
• Future market growth
• Salesforce’s acquisition of Slack

Growth stats for Slack and Microsoft Teams

Slack is a definitive leader in the business messaging space. As of 2019, about a billion messages per week were sent on the platform, and daily active users (DAU) exceeded 12 million based on Slack’s most recent announcement.

Teams, on the other hand, has a higher number of daily users. In April 2021, Teams reached a DAU of 145 million, which is impressive growth if you consider that the company only had about 75 million daily users in the middle of the year. 

So, you may wonder why there’s such a difference? It’s important to understand that the 12 million DAU estimate for Slack came about during October of 2019. 

Since then, user counts have grown due to the pandemic, but there’s a clear indication that Teams is still the market leader based on DAUs. 

To put it in perspective, Alaa Saayed, ICT Industry Director at Frost & Sullivan, commented on the adoption of collaboration apps like Slack and Teams:

“In 2020, the pandemic and home working realities set unprecedented levels of demand for team collaboration services. They have a significant impact on remote workers. Not only helping individuals to communicate and collaborate with each other but allowing managers to articulate goals, and employees to feel connected.”

Most will agree that Teams is winning this war because it’s a free add-on to Microsoft 365. This means that enterprise-level companies have an easier path to adoption for the software. 

Household names using Slack or Microsoft Teams

There are thousands of companies worldwide that use these platforms to keep their employees and clients in touch. 

Let’s take a look at six case studies that represent how some businesses are creating opportunities using each platform.

Slack case studies

Slack is present in the technology stacks of 750,000 organizations, but what household names use the messaging app? 

Microsoft Teams case studies

According to Microsoft, 91% of large companies use the Teams platform for business communications.

Slack and Microsoft Teams in use together

While Microsoft 365 includes a Teams license, independent research in 2019 showed that 65% of companies using Microsoft 365 also had some instances of Slack.

As the number of Teams users has exploded exponentially in 2020, this sample is likely out of date.

When user preference trumps company policy, forcing users to switch to a single app is almost impossible.

Blair Pleasant, President and Principal Analyst of COMMfusion, commented on the use of multiple collaboration apps in enterprises:

“It remains challenging to get users to switch from apps they've already adopted, notably Slack - especially once they become part of the organization's workflow. Rather than disrupt the workflow, most organizations opt to support multiple team apps.”

This is far from over, and the fact that most enterprises tend to use more than one application may mean that there’s room for two kings in the realm of business messaging.

You should also consider the acquisition of Slack by Salesforce in the third quarter of 2020 – a change that is guaranteed to make waves.

Future market growth

Slack future growth

Slack announced Slack Connect in June 2020, which serves as a way for companies to use Slack in a cross-company capacity. This will help ensure organizations have a channel to communicate without heavy reliance on email.

Further to this announcement, direct messaging will soon be available in Slack Connect too.

These moves are clear indications that Slack intends to connect enterprises with other enterprises using Slack.

Microsoft Teams future growth

Microsoft announced its shared channel play (Teams Connect) at Microsoft Ignite in March 2021.

This will provide a more native alternative to extending access to Teams tenants via external access or guest access.

Neither current experience is perfect - as indicated by the number of feature requests and comments on the Teams Community Forum. The view count sits at 382k as of the end of November 2020.

At the time of the announcement, it hasn't been revealed how many users or organizations Teams Connect will support.

But, Teams Connect is a clear nod from Microsoft recognizing the importance of cross-company collaboration.

Microsoft’s focus appears to be on internal communication for the most part.

And with customers like McCann and Air France, the future of Microsoft Teams is bright as indicated by its daily user growth of 200% between March and October 2020.

Best of suite trumps best of breed

Things are quickly becoming more consolidated since doing so helps reduce task and tab switching. For this reason, many businesses are finding the convenience of having a suite of tools under a single banner to be useful.

Tim Banting, Senior Principal Analyst at Omdia, commented on the trend:

“According to our research, 55% of businesses will consolidate their collaboration tools into a single suite within the next 12-24 months. Organizations believe that a consolidated suite or platform provides improved team productivity, lower costs, and easier administration.

Salesforce/Slack and Microsoft Teams as part of Microsoft 365 will force many organizations to select but a few integrative platforms as part of their UCC strategy.”

Salesforce’s acquisition of Slack

In December 2020, Salesforce confirmed its acquisition of Slack for $27.7 billion. 

Amid rumors of the upcoming acquisition, Slack’s stock price grew significantly. 

According to a report prepared by Ryan MacWilliams, Software Equity Research Analyst at Stephens Inc, less than a week before the purchase was confirmed:

“Slack shares are up almost 25% after a WSJ report noted that CRM (Salesforce) has been in acquisition talks with the company at a valuation above its previous ~$17 billion.” 

Irwin Lazar, VP and Service Director at Nemertes Research, laid out three ways he thinks the Slack acquisition could pan out in his NoJitter article:

1. Salesforce largely continues Slack as-is but builds tighter integration into its own products
2. Salesforce takes on Microsoft Teams
3. Slack simply becomes embedded into Salesforce

The first and second options seem the most likely. Users of Slack certainly won’t be looking forward to the latter. 

In fact, when asked about the preference of collaboration app interfaces, 31% of people surveyed suggested they prefer Slack.